The Government finalizes the transposition of the Real Estate Credit Contract Directive

• The Law, approved by the Congress of Deputies last February, is completed with the corresponding regulatory development, through a Royal Decree and a Ministerial Order adopted today.
• The approved legislation regulates, among other aspects, the advisory regime, the information to be provided to clients, the advertising and the training and competence requirements that must be met by the staff and managers of real estate lenders and intermediaries who provide real estate loan services.
• The deadline for transposition of this Directive expired in March 2016 and in these months the accumulated delay has been resolved
• 10 of the 14 Community Directives that were still pending transposition in June 2018 have been incorporated into the Spanish legal system

The Government has completed the transposition of the Community Directive on Real Estate Credit Contracts, which had been pending for three years. The Royal Decree and the Ministerial Order adopted today complete the Real Estate Credit Law approved by the Congress of Deputies last February.

The rules reinforce the protection of consumers and establish a framework of legal security for operators. Thus, the Royal Decree includes, among others, the requirements for the provision of advisory services; the requirements for registration in the corresponding registry of real estate credit lenders; the specifications and technical requirements of the telematic means that should be used for the referral to the notary of the pre-contractual documentation or the information to be provided to the clients during the term of the contract, which should be accessible for people with disabilities.

The Order regulates specific aspects such as the extension of the advertising rules of the banking activity to lenders and real estate credit intermediaries; the Pre-contractual Information and Standardized Warning Cards to be delivered to customers; the terms of the information of the loans in foreign currency and the minimum requirements of knowledge and competence required of the personnel and directors of real estate lenders (including credit institutions) and intermediaries. Likewise, the Order has incorporated the measures that guarantee the maintenance of the protection of the owners of reverse mortgages, which could have been affected by the changes introduced in the real estate regulation by the new regulations.

The outstanding aspects of the Real Estate Credit Law are thus completed. A Law that responds and establishes a clear framework of action that allows strengthening the protection of clients, especially vulnerable groups, through proportionate measures, improving information and increasing transparency. Likewise, the Law provides legal security to entities and clients, an important aspect for the housing market to work properly and for citizens to have access to these loans in the best conditions.

With the incorporation into the legal system of this norm, the transposition of 10 of the 14 Community Directives that in June 2018 were pending transposition within the scope of the Ministry of Economy and Business has been completed. These are rules that regulate aspects related to money laundering, the functioning of financial markets and the protection of consumers, citizens and investors and whose transposition guarantees their rights.